The logo features the words 'Biggie Smalls' within a crown-shaped illustration, and pays homage to the murdered American rapper of the same name, who is also known known as Biggie or The Notorious B.I.G.

In documents filed with the Federal Court, Delia Nominees Pty Ltd, of which Delia is the director, claimed that in January, a staff member purchased several caps and socks from the Cotton On Australia website that were emblazoned with a design "which featured the words 'Biggie Smalls' in a crown logo".

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Shane Delia's Biggie Smalls Kbabs logo, designed in 2014.

Delia alleges the Cotton On items, which had been on sale since at least December 2018, infringe the copyright of the Biggie Smalls Kbabs business logo, which was designed by Melbourne-based graphic designer Tom Shanahan in 2014, by "referring to and reproducing the whole or a substantial part of the copywright work."

Delia also alleges "Cotton On has made a profit by its wrongful acts and conduct" and that the Biggie Smalls Kbabs business sustained loss and damage, including to its reputation.

Delia has trademarked the words 'Biggie Smalls' in Australia for the purpose of 'restaurant services', as well as its well-known Biggie Smalls crown logo, for the restaurant industry, clothing and footwear and retailing goods.

In a statement of claim, Delia seeks an award of damages which it says should take into account the profit made by Cotton On through the sale of the alleged infringing items. It is understood Cotton On removed the items from sale in late January.

Cotton On's cap featuring a Biggie Smalls crown design.

In its defence lodged in court, Cotton On denied it infringed the copyright of the Biggie Smalls Kbabs business logo. It also said it would resist any claim by Delia for damages on the basis that it "was not aware and had no reasonable grounds for suspecting" it had infringed any copyright owned by Delia.

However, on Friday, a spokeswoman from Cotton On said the copyright claim against it had now been settled.

"A settlement has been agreed and we are in the process of applying to the court to have the case removed," she said.

Neither Cotton On or Delia would confirm details of the settlement. However, a spokesman for law firm K & L Gates, representing Delia, confirmed a "private settlement" had been reached.

It is not the first time Cotton On has been embroiled in allegations of trademark infringement. In 2008, fashion brand Elwood successfully sued the retailer for ripping off one of its T-shirt designs and in 2016 it reached a settlement with the California-based Island Company after being accused of knocking off one of its trademarked phrases.

US rapper Biggie Smalls was shot dead in 1997.

Later that year, New York designer Elektra Printz Gorski sued the retailer in the Federal Court for allegedly infringing her trademarked fashion brand, LETTUCE TURNIP THE BEET.

It is also not the first time Delia has engaged lawyers to protect his Biggie Smalls Kbabs business. In November 2016, he sent a cease and desist letter to a Gold Coast business who had named their food truck venture Biggie Smallz. The company is now called NOTORIOUS E.A.T.

Delia opened his first hip-hop-inspired kebab diner on Smith Street in 2015, seven years after he launched Maha. In 2017, the chef-cum-tv-presenter launched the Biggie Smalls food truck and a second store on Chapel Street, Windsor, which has since closed its doors. It will re-open in June as Maha East – a laidback sister venue to his city flagship.